World Bank fears Donald Trump’s austerity axemen could demand spending cuts: sources
World Bank officials — under fire for losing track of $24 billion in climate funds — are panicking over the prospect of severe budget cuts as President-elect Donald Trump pledges to slash US government spending, The Post has learned.
According to sources, top brass at the Washington-based lender — which has faced accusations that it’s operated like a slush fund for jet-setting bureaucrats despite a mandate to fight poverty and climate change — have been on edge since Trump’s blowout election victory.
This week, it emerged that Elon Musk and Vivek Ramaswamy are slated to lead a White House advisory body called the Department of Government Efficiency, or DOGE — and they could have the World Bank in their sights, according to sources.
“They have been running around like headless chickens since Trump won,” one permanent staffer speaking on condition of anonymity, told The Post.
“It has sparked fear,” the source added. “They will be desperately trying to show they are saving money.”
Trump named the Tesla titan and his one-time Republican presidential challenger to head DOGE on Tuesday. Ramaswamy said he and Musk will “bring a chainsaw” to pare back feckless spending.
“The government shouldn’t be in the business of giving away free money. Uncle Sam isn’t supposed to be ‘Uncle Sucker,” the 39-year-old tech entrepreneur wrote on X.
A source close to the GOP firebrand told The Post that all foreign aid spending is “in scope” for possible cuts.
One area ripe for the knife has been the World Bank’s lavish spending on air travel, fueled by a policy that allows unelected bureaucrats to upgrade to business class for any flight that’s five hours or longer.
Leaked documents obtained by The Post show how managers blew nearly $9,000 on a return business class ticket with a private suite from Washington Dulles airport to Baku in Azerbaijan on the uber-luxurious Qatar Airways.
That’s despite regulations governing the World Bank’s domestic counterparts at USAID, this country’s development agency, which state that “air travel is allowed only in economy class” and that US carriers must be used.
During the last Trump administration, World Bank officials went to extraordinary lengths to keep the 45th President onside, repeatedly inviting his daughter and then-adviser Ivanka to speak at its conferences.
Now, a second World Bank source said there is “lots of anxiety” at the global body after the 78-year-old real estate mogul crushed Kamala Harris on Nov. 5 with a resounding electoral college win.
A World Bank spokesperson said: “Last year, management launched a productivity savings initiative, asking each vice presidency to cut 5% of its budget annually from less critical expenses.”
They added that the Biden-nominated boss of the World Bank, Ajay Banga, had set the lender “on a fast course to become better and more effective.”
The latest revelations come after The Post’s reporting on an expose by left-wing charity Oxfam that accused officials of having “lost track” of at least $24 billion of funding for climate change projects.
The study released last month accused the global body of “poor record-keeping” and a lack of transparency. The bank strongly disputed the findings.
The study echoed testimony to Congress by former Trump Treasury official David Malpass in 2017.
Malpass, who went on to lead the World Bank two years later, told lawmakers the institution was “not very efficient” and “often corrupt in their lending practices.”
The former Bear Stearns executive slammed how staffers spent taxpayer cash abroad when they “fly in on first-class airplane tickets to give advice to government officials.”
Senior management in downtown D.C. repeatedly blocked suggestions to crack down on its long-haul business class travel policy during Trump’s first term, according to multiple sources familiar with the matter.
“The attitude was: ‘Who cares? It’s not our money anyway,” lamented one source.
The US government watchdog, the Government Accountability Office, carried out a probe last year into how the bank hands out contracts worldwide.
It found that “US businesses accounted for around one percent of all World Bank borrower
contract dollars awarded from fiscal years 2013 through 2022.”
Officials at the GAO also warned that the Treasury has no “formal processes for determining whether and how to monitor World Bank borrower projects.”
“Without such processes, Treasury may not be able to proactively monitor projects and address potential risks to U.S. interests,” their report said, citing how Chinese giant Huawei had come close to landing a deal for an undersea cable off the coast of Guam, a US territory.
The World Bank was set up in 1944 to help rebuild Europe and Japan after World War II. Today, it doles out cash to less well-off countries as a way “to create a world free of poverty.”
Aside from business class travel, staffers enjoy lavish perks that many hard-working Americans can only dream of.
They include tax-free salaries, generous pension plans that require a mere 5% employee contribution and US healthcare coverage for life.
The generosity of US taxpayers even allow some bank directors to rake in more than America’s commander-in-chief.
Senior executives in Washington can take home up to $511,000 a year without having to hand over a dime to Uncle Sam.
President Biden, by contrast, picks up a pre-tax salary of $400,000 each year.
Even the most junior World Bank employee can pocket as much as $62,000 tax-free.
The United States is the only government from the 189 World Bank countries with the power to veto any changes on how it is run because it is the global body’s main founding member.
Richer nations make both direct donations to the bank and multi-billion-dollar pledges that allow it to borrow megabucks loans to bankroll projects abroad.
A May 2024 report by the Congressional Research Service shows the World Bank’s total capital amounts to just short of $320 billion, with US taxpayers contributing or being left on the hook for as much as $57 billion.
